WEC Energy Group

Allen L. Leverett, WEC Energy Group

Allen L. Leverett

Geographical Diversification

Editors’ Note

Allen Leverett was appointed President of Milwaukee-based Wisconsin Energy Corporation, named WEC Energy Group in August 2013. He also served as President and Chief Executive Officer of We Generation since March 2011. Leverett joined Wisconsin Energy in 2003 as Chief Financial Officer. In May 2004, he was named Executive Vice President and Chief Financial Officer of Wisconsin Energy and We Energies. Leverett earned his bachelor’s degree, summa cum laude, in electrical engineering and mathematics from Vanderbilt University. He also earned a master’s degree in electrical engineering from Stanford University, and a Master of Business Administration degree with a finance concentration from Auburn University.

What is the secret behind WEC’s consistent strength?

Gale (Klappa, Chairman and CEO) and I have worked together for quite a while. One of the things we have learned from our experience is the need for a tremendous focus on customers – even in a regulated industry. A high level of customer satisfaction will translate into good regulatory relationships and with that, an environment that is going to translate into good shareholder returns or at least the ability to earn those if we manage operations well.

We’re now embarking on a big geographical diversification in Illinois, Michigan, and Minnesota. Our customer focus and construction expertise will allow us to keep this moving.

When you acquired Integrys, how important was it to integrate the cultures to ensure a smooth transition?

Sometimes there are social issues between the senior management teams, but there were none between Wisconsin Energy and Integrys.

The only cultural difference that we had between the two companies was the Illinois operation. The people in Illinois want to be proud to work for that company and want to do a good job, but their execution needs to improve. We will bring our customer service culture to the Illinois operation.

How critical is innovation to the business?

Electricity and natural gas are very mature markets but innovation, even within a mature market, is very important.

Before the merger, tremendous innovation took place in moving away from manual-read meters. In Wisconsin, we currently have close to 100 percent automated meters. That has had a great impact on our costs and also on customer satisfaction, since automatic meter reads are more accurate reads.

We are now applying the same metering technology on capacitor banks on our electric distribution lines. The meters are capable of providing a low cost, real time, reliable option to monitor the health of the equipment to prevent voltage problems. As we install more sensors and devices on our distribution lines, we will be able to determine the location of an interruption much more quickly rather than waiting for a call and sending a troubleshooter to investigate. As a result we will require a more advanced operating system to manage all the data. Many vendors are spending a considerable amount on research and development for Advanced Distribution Management Systems to aid utilities in managing the inputs in a data rich environment.

What challenges lie ahead for the industry?

In our business, we have gas and electric utilities, and we have to think about those challenges separately because they are very different businesses.

On the gas distribution side, the big challenge is, in many ways, the age of the infrastructure. We’re in better shape in Wisconsin than in Illinois, but updating that infrastructure is a huge challenge in terms of the amount of capital, and minimizing the impact on customers.

Also, the EPA just issued their Clean Power Plan, so we have to respond to that in such a way that doesn’t make electricity unaffordable to our residential customers, and more importantly to our manufacturing customers.•